Agenda item

The Committee is asked to approve the report recommendations.

25.1       Daniel Kanaris, AON, explained they had been commissioned to undertake a review of the current administration service and Key Performance Indicators (KPIs) of the Fund, as part of the agreed governance review.  Additionally, in response to the challenge from Committee at their recent meetings in relation to the performance against the current Key Performance Indicators (KPIs) of the Fund which had not been achieved constantly for a long period of time and Committee wished to understand the drivers behind this.

25.2       AON’s full report provided detailed observations, the committee proceeded to discuss and debate the findings.  Members were interested in the staffing levels as detailed on page 204 of the report. 

25.3       A member questioned why proactive steps hadn't been taken years ago.  The Head of Pensions explained that a fully formed induction programme had now been devised for new starters, as this wasn't previously in place.  It was noted that historically there had been no investment in the Pension Team in Gloucestershire for a considerable time, compared to other authorities.  Members were advised that in the past, the scheme was much simpler to administer and a number of factors, including academisation, regulation changes, the rule of 85, etc. had changed, which had increased the complexities and demands on the service.. 

25.4       It was reported that it had also taken nearly two years to recruit new resources agreed by Committee in 2021, however the membership of the fund had continued to increase as it now involved over 60k members and 200 employers.  Management were now trying to overcome historical issues due to the lack of investment in the administration team and it would take time to train staff and fully resource the team. 

25.5       The lack of staffing resources had impacted on development work, which meant that Gloucestershire was behind in its peers in terms of the system development.  It was noted that the majority of other Funds were already utilising the software and that had been beneficial for their members.  It was noted that Gloucestershire's full time equivalent (fte) was currently 22.5 posts, compared to Cornwall at 31fte posts and other comparable Funds who had even more resources.  It was necessary to be pragmatic to ensure an improved journey. 

25.6       Members were advised that out of the 66 funds who use the same software, there were only 6 that weren't operating member self service, and Gloucestershire was one of them and officers were seeking support from the committee to make the service more proactive, in order to deliver communications, direct to its members. 

25.7       The Head of Finance explained that the new Head of Pensions didn't commence at GCC until 2021 and it was clear the performance issues had been inherited.  He agreed there had been no investment in the service for a number of years and since the new Head of Pensions had started the service journey was beginning to improve.  He recognised that the team needed to be resourced effectively to bring about a positive change.  It was noted that the current team were under resourced and were trying to do everything.  This was supported by the fact that AON were clear in their report that Gloucestershire had fallen behind and needed a direction of travel. 

25.8       It was noted that Pension Dashboard was a huge national platform and it will generate more more work for the service.  Some members recognised the need for investment and had repeatedly made the request and they accepted that it was necessary to future proof the service as it would become more complicated going forward. 

25.9       AON recommended that the staffing levels should be significantly increased, the committee were advised that some funds had used consultants to undertake the increased work but this was at a considerably higher cost. 

25.10    The employer representative felt the report was concerning given how far Gloucestershire was behind it peers and the impact this would have on employers and employees within the fund.  It was noted that teaching staff had an automated system that was quick and efficient to use and linked to payroll which enabled users to have real time information.

25.11    It was recognised the members of the Gloucestershire LGPS only received a paper based annual statement and as a member and an employer she could see the difference in the way the respective funds operate.  It was also noted that many funds no longer operated on a paper basis as it was time consuming and took longer to process, the automated systems were far quicker and efficient as the information was uploaded instantly.  By being automated it would give staff ownership of their pension.. 

25.12    This was further supported by the fact that year end data process for teaching staff could be completed within 30mins by using an automated system and the Gloucestershire fund took days to collate and submit the paper based returns.  It was noted that both were public sector schemes, but that one was considerably behind the other in terms of functionality. 

25.13    During the discussion, the majority of members felt it was necessary to support the report recommendation in order to progress the service for the benefit of its members.  Members of the committee accepted that the benchmarks had not been achieved for a number of years due to the lack of resources and investment was required.

25.14    Members accepted that a modern pension service would ensure engagement with its members, and the increase in staff and the new systems would enable this to be achieved.  Some members recognised the need to modernise the service to bring about a positive change, whereas some members were sceptical, but in general felt that a balance needed to be struck in order to be proactive. 

25.15    During the discussion it was agreed that rigorous key performance indicators needed to be set on a yearly basis, in order to hold management to account.  The Head of Pensions explained if approved a plan would be devised and monitored closely. 

25.16    The Pension Board representative agreed to relay the issues raised at the next Board meeting, and requested the information be made available to the Pension Board. 

25.17    Resolved

That Committee accepted the recommendations of the AON report.

That Committee approved the additional resourcing as outlined in the main body of the report and the associated budget.

That Committee approved the inclusion into the formal specification to be procured in 2023/24 the additional system functionality, as set out in the main body of the report.

That Committee approved the revised temporary Key Performance Indicators, as set out in the main body of the report.